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U.S. pharmaceutical and biotechnology companies have increasingly relied on Chinese partners for production, research, and raw material supply. However, as geopolitical tensions escalate, some companies are seeking alternative options. From large pharmaceutical companies like AstraZeneca to smaller biotech companies like Amicus Therapeutics based in New Jersey, these companies state that now is the time to reduce the risks associated with dependence on China. Amicus Therapeutics is seeking non-Chinese suppliers for raw materials for its rare disease treatments. Industry experts point out that this shift could lead to delays in the U.S. drug approval process and increased costs, as this transition requires time and investment. Patients in the U.S. and Europe are generally unaware that U.S. and European companies often rely on China for basic chemical services and drug components. In recent years, disputes between China and the U.S. in trade and military fields have already impacted this industry. Executives point out that the top-tier services provided by China are usually less expensive than those in Western countries. Kymera Therapeutics' CEO Nello Mainolfi says the company is currently making decisions based on reducing the risk of dependence on a single or few countries. The Massachusetts-based company, which focuses on the development of drugs for cancer and the immune system, mainly relies on Chinese companies for production but has begun to expand more production activities in Europe, India, and the U.S. One of the factors driving this change is the Biosecure Act, which passed the House with overwhelming bipartisan support. The act prohibits companies that receive government funding or contracts from trading with certain Chinese companies. The most notable names on the list include WuXi AppTec and its biopharmaceutical subsidiary, which have numerous clients worldwide for research and production. WuXi AppTec stated in May that the act's listing was "a preemptive and unreasonable designation without due process." Both the company and its biopharmaceutical subsidiary declared that they do not pose a security risk to the U.S. or any other country. The future of the Biosecure Act in the Senate is unclear, but the current version requires companies to sever ties with the targeted Chinese companies by 2032. Nonetheless, the prospect of this restriction has already influenced companies considering whether to partner with WuXi AppTec or other Chinese companies, according to Steve Abrams, global co-head of life sciences at Hogan Lovells. These changes do not mean that the industry ties between China and the West will be completely severed. U.S. and European pharmaceutical companies still view the market prospects for selling their products in China favorably. China is the world's second-largest pharmaceutical market after the U.S. and has a rapidly aging population. Chinese biotechnology companies have signed licensing agreements worth billions of dollars aimed at bringing drugs from China to the global market. An example of a U.S. company cutting ties with China is Vir Biotechnology, headquartered in San Francisco, which develops antiviral drugs and cancer treatments. A spokesperson said the company ended production at WuXi AppTec earlier this year and is now working with U.S. production partners, focusing on internal R&D and production. Other companies are working to explore new raw material supply channels as a safeguard. Meanwhile, large pharmaceutical companies like AstraZeneca are actively building independent supply chain systems in both China and the West. Amicus Therapeutics relies on WuXi AppTec to produce drugs for treating Pompe disease, which affects the heart and muscles. The company's CEO, Bradley Campbell, notes that while Amicus is still willing to cooperate with WuXi AppTec in accordance with the latest version of the Biosecurity Act, the company is seeking raw material suppliers outside of China. Campbell mentioned that the Biosecurity Act prompted them to scrutinize the sources of materials closely and reassess the complexity of the current relationship with China. WuXi AppTec is also assisting Amicus in diversifying its supply chain: the company has established a factory in Ireland, which is expected to begin commercial drug production next year. According to a recent survey by the Biotechnology Innovation Organization, nearly 80% of U.S. biotechnology companies have at least one contract with a Chinese company. Chinese companies have honed their expertise and infrastructure over the years with government support, earning global industry respect. Supply chain analytics company Qyobo indicates that WuXi AppTec provides raw materials for cancer drugs like Imbruvica and Jemperli. AlphaSense's data platform shows that 60 companies listed in the U.S. have at least one partnership with either of these two companies. John Maraganore, former CEO of Alnylam Pharmaceuticals and now a venture capitalist providing company consulting services, points out that as companies shift funds from trials or research to reshaping production methods, it could lead to increased drug development costs or slowed progress. He hopes that U.S. legislative bodies will pay more attention to encouraging domestic production to avoid the costs and other challenges posed by the Biosecurity Act. Maraganore states, "We all hope that this goal can be achieved through more incentives and fewer mandates." There are signs that WuXi AppTec, the listed company, may be facing headwinds. WuXi AppTec stated that as of the end of September, the company's backlog of unfulfilled orders increased by 25% compared to the end of last year. Both the company and its subsidiary, WuXi AppTec Biologics, stated that despite challenges from the U.S., their business remains strong. Waltham, quality. Invivyd's chairman, Mark Eliá, based in the U.S., said the company plans to complete its R&D and production collaboration with WuXi AppTec Biologics within the next few months. The company is using WuXi AppTec Biologics' research and production capabilities to develop a COVID-19 treatment drug, Pemgarda. He noted that Invivyd is looking for alternative locations and plans to move work outside of China. Eliá stated that Invivyd's ability to pivot is due to its cyclical production process. "All these issues must be addressed, but they are entirely different from 'unsolvable,'" he emphasized, "It's not going to happen." For startups, losing a Chinese supplier due to geopolitical issues could pose a threat to the entire enterprise, so venture capitalists advise their portfolio companies to avoid such risks. RA Capital Management, based in Boston, focuses on healthcare industry investments. The company's head, Tess Cameron, says that addressing supplier risk has become one of the primary due diligence issues when reviewing a startup for financing. "This involves assets, transaction terms, ownership structure, supply chain, and more," she explains.